Question :
61.It difficult to compare investment centers using return investment when : 1302898
61.It is difficult to compare investment centers using return on investment when there is a significant difference in the _________ between the investment centers.
A.age of the assets
B.net operating profit after taxes
C.amount of noninterest-bearing current liabilities
D.market share
62.The 2014income statement for the East Division of Procter Wells Company is as follows:
Sales $1,800,000
Operating expenses 1,380,000
Net operating income 420,000
Interest expense 120,000
Earnings before taxes 300,000
Income tax expense (40%) 120,000
Net income $ 180,000
This division’s invested capital is $4,000,000.How much is theEast Division’s return on investment?
A.6.3%
B.5.7%
C.10.5%
D.7.5%
63.The income statement for the Commercial ConstructionDivision of the KenyonCompany is as follows:
Sales $272,000
Operating expenses 132,000
Net operating income 140,000
Interest expense 20,000
Earnings before taxes 120,000
Income tax expense (30%) 36,000
Net income $84,000
If this division’s invested capital is $500,000, how much is its return on investment?
A.19.6%
B.16.8%
C.20.8%
D.14.0%
64.South Division of Renato Enterprises reported net income of $480,000 in March on sales of $7,900,000. If this division hasno interest expense, an income tax rate of 30 percent, and reported a return on investment of 12 percent, how much is invested capital?
A.$948,000
B.$4,000,000
C.$2,800,000
D.More information is needed to determine the answer.
65.West Division of PoolGuard has invested capital of $900,000. This division incurred $80,000 in interest expense and $20,000 in income tax expense related to interest in July.If this division reported a return on investment of 15 percent, how much isNOPAT?
A.$60,000
B.$75,000
C.$135,000
D.$195,000
66.Rail Star Company reported the following results for 2014:
Sales$6,000,000
Investment turnover2.4
Return on investment10%
Given this information, how much is the company’s invested capital?
A.$2,500,000
B.$1,440,000
C.$600,000
D.$1,440,000
67.The FloridaDivision of Garner Furniture reported the following results for 2014:
Invested capital$800,000
Profit margin5%
Return on investment8%
Given this information, how much was sales?
A.$1,280,000
B.$500,000
C.$1,600,000
D.$64,000
68.The 2014 income statement for the Clothing Division of Tom Ron Surf Company is as follows:
Sales $445,000
Operating expenses 270,000
Net operating income 175,000
Interest expense 35,000
Earnings before taxes 140,000
Income tax expense (30%) 42,000
Net income $98,000
How much is net operating profit after taxes?
A.$108,500
B.$133,000
C.$73,500
D.$122,500
69.The JerseyDivision of Yankee Products has invested capital of $1,400,000.This division incurred $80,000 in interest expense and $140,000 in income tax expense in 2014.If this division reported a return on investment of 14 percent, how much is net operating profit after taxes?
A.$416,000
B.$196,000
C.$116,000
D.$276,000
70.Western Electric reported the following results for 2014:
Sales$8,400,000
Investment turnover2.5
Return on investment12%
Given this information, how much is the company’s NOPAT?
A.$1,008,000
B.$2,520,000
C.$403,200
D.$3,360,000
